After Sebi order, Sahara says SIFCL surrendered sub-broker registration two years ago

By: |
March 7, 2021 2:11 PM

Days after Sebi cancelled Sahara India Financial Corporation Ltd's (SIFCL) certificate of registration as a sub-broker citing non-compliance with 'fit and proper' criteria, Sahara India on Sunday said the company had "willfully" surrendered the licence two years back.

sebiOn March 3, Sebi passed an order cancelling the certificate of registration of SIFCL as a sub-broker citing its failure to fulfill the 'fit and proper' criteria.

Days after Sebi cancelled Sahara India Financial Corporation Ltd’s (SIFCL) certificate of registration as a sub-broker citing non-compliance with ‘fit and proper’ criteria, Sahara India on Sunday said the company had “willfully” surrendered the licence two years back.

On March 3, Sebi passed an order cancelling the certificate of registration of SIFCL as a sub-broker citing its failure to fulfill the ‘fit and proper’ criteria.

In a statement on Sunday, Sahara India Pariwar said the “licence was already willfully surrendered by the company two years back”.

On March 4, the group wrote to Sebi saying that on October 3, 2018, SIFCL had surrendered the sub-brokership license to IDBI Capital and that through a letter dated October 8, 2018, “it was well communicated to Sebi”, as per the statement.

“It appears that mentioning of voluntarily surrendering the license has escaped Sebi’s attention. The order should have the word ‘cancelled as surrendered’ in order to avoid ambiguity in this regard and placing true and correct facts amongst public at large,” it noted.

Further, the statement said that in the letter dated October 8, 2018, SIFCL had maintained that it had never worked on the issued licenses since inception and voluntarily surrendering both the licenses.

In the March 3 order, Sebi said that as a watchdog of the securities market and protector of investor’s interest, Sebi cannot take it lightly in view of the actions/ proceedings carried out against a substantial shareholder/ promoter of the noticee i.e. Subrata Roy Sahara and the companies with whom he is associated.

Passing the order, Sebi Whole-Time Member G Mahalingam had said that he was in agreement with the findings of the designated authority that the noticee (SIFCL) is not a “fit and proper person” in terms of Intermediaries Regulations.

“Having regard to the facts and circumstances of the instant proceedings, I accept the recommendation of the designated authority that the certificate of registration granted to the noticee as a sub?broker, be cancelled,” the order had said.

In the Sebi order, it was mentioned that a post-enquiry showcause notice was issued to SIFCL on December 26, 2018, along with a copy of the enquiry report by the designated authority.

The order also observed that SIFCL submitted a reply dated January 24, 2019, to the showcause notice “inter alia stating that it was awaiting a reply from M/s IDBI Capital and Securities Limited with regard to the voluntary surrender of both its sub?broker certificate (NSE and BSE) and had requested that Sebi kindly instruct IDBI Capital to cancel the Certificate of registration as surrendered by the noticee”.

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